After spending 12 months preparing for his formal transition from president to CEO of Columbia Distributing, Chris Steffanci isn’t wasting any time making his mark.

In his two months at the helm since taking the role in January, following the announcement of CEO Gregg Christiansen’s retirement in March 2016, Steffanci has overseen a period of rapid growth at Columbia, already one of the largest beverage wholesalers in the U.S. Last month, the company announced the acquisition of Oregon-based craft beer supplier General Distributors for an undisclosed sum, a move which will add over 3 million cases to Columbia’s business. A week later, Columbia moved to purchase a majority of the assets of wholesaler Marine View Beverage, adding a further 8 million cases. When those acquisitions are finalized, Columbia will have a total volume of about 70 million cases spread across its 11 facilities servicing Washington, Oregon and northern California.

Although those acquisitions are mainly focused on expanding Columbia’s presence in beer, the Portland, Ore.-based distributor is also enjoying robust growth from its non-alcoholic business. That segment, while still representing about 30 percent of its complete portfolio, has accounted for roughly 50 percent of the company’s incremental profit in recent years, according to Steffanci, and has helped create the impetus for Columbia to evolve its approach to that side of the market.

“We are big believers in the fact that we want to represent beverages for all occasions and for all consumers across different categories,” Steffanci said in a call with BevNET last week.

Columbia, founded in 1935, has worked with non-alcoholic beverages for decades, but, as Steffanci noted in a statement upon taking over as president, competition within that segment is stronger than ever. As consumers seek a greater variety of choices in beverage, and show a greater willingness to try new brands that offer those choices, the doors have opened for new, more complex offerings and categories that were previously shut. Alongside that evolution, the retail landscape is changing, fueled by large-scale acquisitions, such as Amazon’s purchase of Whole Foods, and the overall maturation of ecommerce.

As a consequence, Columbia has taken a holistic, data-driven approach to developing its entire portfolio, analyzing segments and categories as well as consumer buying patterns and behaviors. Non-alcoholic brands include Brew Dr. Kombucha, Vita Coco, BodyArmor, Talking Rain and offerings from Dr Pepper Snapple (DPS), such as Bai and Core.

“What we’ve done across our entire business in both beer and non-alcoholic is built out this portfolio architecture that lays out consumer needs, what brands meet those needs, and what are the price points, categories and segments of the portfolio that we currently have,” Steffanci said. “What that has allowed us to do is really define what the white space is, either where we have too many brands in one area or in a lot of instances identifying opportunities where we don’t have brands that meet certain consumer needs.”

Columbia has structured that architecture to allow the alcoholic and non-alcoholic sides of the portfolio to help inform each other, with regards things like flavor profiles, packaging opportunities and consumer preferences. Working on both sides of the alcoholic spectrum has helped shape Columbia into a full-service distributor as well, providing retailers a portfolio of brands that in some markets would require using multiple suppliers.

“Obviously consumers under 21 are going to be drinking non-alcoholic drinks, so we understand flavor profiles, we understand packaging opportunities that ultimately, when those consumers turn 21, translate into our beer portfolio,” Steffanci said, noting that drinks based around health and wellness were driving the non-alcoholic segment. “It’s performance-based drinks that are ultimately exciting consumers, it’s water, it’s tea, it’s better-for-you. That’s translating into beer with segments like sparkling hard water, like White Claw and Truly, and those brands are on fire because it ties back to that same insight.”

Determining which brands or trends to pursue and which to avoid is the task of Columbia’s business development team, which identifies what segments or categories will be strong bets over a 3-5 year forecast. Even while aiming for long-term growth, however, Steffanci said Columbia’s portfolio structure “rarely stays the same for more than six to 12 months,” allowing room for the company to pivot strategically on short notice if required.

The team also determines if the size of those opportunities justifies additional capital investment in equipment, logistical services or infrastructure needed to service them. For example, the company has dedicated a significant portion of warehouse space for cold storage, but does not have refrigerated delivery trucks, potentially limiting the range of products it can supply. Ultimately, the potential return on investment is the deciding factor.

“We are willing to do both: invest when we need to but, at the same time, also know we have the opportunity to find the right brand that fits into what we are trying to do as an organization,” Steffanci said. He noted that for cold brew coffee, which is typically a cold chain item, Columbia picked up New York-based Rise, which is shelf-stable. “We are patient when we look at categories like this; we waited for a brand that fits into what we are trying to do as an organization and we didn’t have to alter our entire logistical model.”

Part of that is dictated by Columbia’s geography: between the urban hubs of Portland and Seattle, the company one of the country’s largest and most distinguishing markets for both craft beer, coffee and kombucha.

“The good news is our retail environment is very open to consumer choice and variety based on the nature [of the consumer],” he said. “Retailers are open to new things but their own dynamic has changed— bars and restaurants that used to compete with each other are now competing with Whole Foods and high end boutique grocery stores.”

The bad news? The heightened interest in better-for-you drinks has been accompanied by a backlash against sugar-sweetened beverages (SSBs), which culminated last June when the Seattle City Council approved a 1.75 cents per ounce tax on SSB distributors. Steffanci admitted the tariff has had a “big negative impact” on Columbia’s soda business in the Emerald City, pushing down sales within city limits while increasing turns in retailers just outside the border. “There’s no data to show people are drinking less carbonated soft drinks,” he said. “It’s just moving the problem around a bit.”

Being in the Pacific Northwest also puts Columbia in the backyard of the world’s largest internet retailer— and the parent company of Whole Foods— in Amazon. As the impact of ecommerce’s development continues to be felt across the beverage industry, Steffanci said Columbia is putting direct resources into Amazon and ecommerce in general.

“We want to work with these ecommerce retailers and be part of the conversation, instead of being reactive,” he said.